Ultimate Logan County Real Estate Investing Guide for 2024

BRRRR stands for “Buy, Rehab, Rent, Refinance, Repeat”. If you plan to expand your investments, the BRRRR is an excellent strategy to use. It is essential that you are qualified to receive a “cash-out” refinance for the system to be successful.

When you have concluded repairing the property, its market value has to be higher than your total acquisition and fix-up expenses. The asset is refinanced using the ARV and the difference, or equity, is given to you in cash. This money is placed into another investment asset, and so on. You add appreciating assets to your portfolio and lease revenue to your cash flow.

If an investor has a large number of investment properties, it seems smart to pay a property manager and establish a passive income source. Discover Logan County real property management professionals when you search through our list of professionals.

Factors to Consider

Population Growth

The expansion or decrease of the population can illustrate if that region is interesting to landlords. When you discover good population expansion, you can be certain that the community is drawing likely tenants to the location. Moving companies are attracted to rising regions providing secure jobs to households who move there. Increasing populations create a dependable tenant pool that can handle rent bumps and home purchasers who help keep your investment property prices high.

Property Taxes

Property taxes, ongoing upkeep spendings, and insurance specifically decrease your returns. Unreasonable real estate tax rates will negatively impact a real estate investor’s income. If property tax rates are excessive in a specific city, you will need to search somewhere else.

Price to Rent Ratio

The price to rent ratio (p/r) is a signal of what amount of rent can be charged compared to the value of the asset. An investor can not pay a high sum for an investment property if they can only demand a small rent not enabling them to repay the investment in a reasonable time. A high price-to-rent ratio informs you that you can charge modest rent in that community, a smaller p/r signals you that you can charge more.

Median Gross Rents

Median gross rents signal whether a location’s rental market is dependable. Hunt for a repeating increase in median rents over time. You will not be able to realize your investment goals in an area where median gross rental rates are dropping.

Median Population Age

Median population age in a good long-term investment environment must show the normal worker’s age. If people are migrating into the neighborhood, the median age will have no problem remaining at the level of the labor force. If you discover a high median age, your supply of tenants is declining. That is a poor long-term economic prospect.

Employment Base Diversity

Having different employers in the location makes the economy not as unstable. If the city’s employees, who are your renters, are hired by a diverse assortment of businesses, you will not lose all of them at once (and your property’s market worth), if a major enterprise in the city goes bankrupt.

Unemployment Rate

High unemployment equals a lower number of tenants and an uncertain housing market. Normally profitable businesses lose customers when other employers retrench employees. Individuals who still have jobs may discover their hours and wages cut. This could cause delayed rent payments and renter defaults.

Income Rates

Median household and per capita income will reflect if the renters that you want are residing in the area. Increasing wages also tell you that rental rates can be increased throughout your ownership of the rental home.

Number of New Jobs Created

The more jobs are consistently being generated in a region, the more stable your tenant source will be. An economy that generates jobs also boosts the number of players in the real estate market. This enables you to acquire additional lease assets and replenish current empty units.

School Ratings

Community schools will cause a huge impact on the housing market in their location. Businesses that are interested in relocating need top notch schools for their workers. Moving businesses relocate and draw potential tenants. Homeowners who relocate to the area have a beneficial effect on property values. Quality schools are a necessary component for a vibrant real estate investment market.

Property Appreciation Rates

Real estate appreciation rates are an imperative element of your long-term investment approach. Investing in assets that you are going to to hold without being sure that they will improve in price is a recipe for disaster. Substandard or dropping property value in a market under assessment is unacceptable.

Residential properties where renters live in furnished accommodations for less than a month are referred to as short-term rentals. Long-term rental units, such as apartments, impose lower rent per night than short-term ones. Because of the high rotation of occupants, short-term rentals require additional recurring maintenance and cleaning.

Short-term rentals are popular with clients travelling for work who are in town for a couple of days, those who are moving and want transient housing, and excursionists. Anyone can turn their home into a short-term rental unit with the tools offered by virtual home-sharing portals like VRBO and AirBnB. This makes short-term rental strategy a good approach to pursue residential real estate investing.

The short-term rental housing venture involves interaction with renters more frequently in comparison with yearly lease units. This results in the investor being required to frequently deal with grievances. You might need to protect your legal exposure by hiring one of the best Logan County investor friendly real estate lawyers.

Factors to Consider

Short-Term Rental Income

You need to imagine the amount of rental revenue you’re searching for based on your investment strategy. Learning about the typical amount of rental fees in the region for short-term rentals will enable you to select a good community to invest.

Median Property Prices

Thoroughly assess the amount that you want to spare for additional real estate. Scout for locations where the purchase price you have to have is appropriate for the present median property prices. You can fine-tune your market survey by studying the median market worth in particular neighborhoods.

Price Per Square Foot

Price per sq ft may be inaccurate if you are looking at different properties. A home with open foyers and high ceilings can’t be contrasted with a traditional-style property with more floor space. If you keep this in mind, the price per sq ft may provide you a broad estimation of real estate prices.

Short-Term Rental Occupancy Rate

The ratio of short-term rental properties that are presently occupied in a city is important data for a future rental property owner. When almost all of the rental properties have tenants, that city requires new rental space. When the rental occupancy levels are low, there isn’t enough need in the market and you must search elsewhere.

Short-Term Rental Cash-on-Cash Return

A short-term rental’s cash-on-cash return can tell you if the purchase is a reasonable use of your own funds. Divide the Net Operating Income (NOI) by the total amount of cash used. The result comes as a percentage. The higher it is, the quicker your investment funds will be recouped and you’ll begin realizing profits. Loan-assisted projects will have a higher cash-on-cash return because you’re using less of your cash.

Average Short-Term Rental Capitalization (Cap) Rates

Average short-term rental capitalization (cap) levels are widely employed by real property investors to evaluate the worth of rental properties. High cap rates mean that investment properties are accessible in that market for reasonable prices. Low cap rates reflect more expensive real estate. Divide your expected Net Operating Income (NOI) by the property’s market worth or asking price. The percentage you will receive is the property’s cap rate.

Local Attractions

Short-term rental units are popular in regions where vacationers are attracted by activities and entertainment spots. This includes top sporting tournaments, children’s sports competitions, schools and universities, large auditoriums and arenas, carnivals, and amusement parks. At certain times of the year, locations with outside activities in the mountains, coastal locations, or near rivers and lakes will draw lots of tourists who need short-term housing.

The fix and flip investment plan involves acquiring a house that needs repairs or renovation, putting more value by upgrading the building, and then selling it for a better market price. Your estimate of fix-up costs must be on target, and you need to be capable of acquiring the house below market worth.

You also want to understand the resale market where the property is situated. The average number of Days On Market (DOM) for homes sold in the market is important. As a “house flipper”, you’ll need to liquidate the upgraded home right away in order to avoid carrying ongoing costs that will lower your returns.

In order that real property owners who need to liquidate their property can readily find you, promote your status by using our list of companies that buy homes for cash in Logan County KS along with top real estate investment firms in Logan County KS.

Also, hunt for bird dogs for real estate investors in Logan County KS. Professionals in our catalogue specialize in acquiring distressed property investments while they’re still off the market.

Factors to Consider

Median Home Price

When you search for a promising area for home flipping, investigate the median house price in the city. Modest median home prices are an indicator that there may be a steady supply of residential properties that can be bought for less than market worth. This is an essential component of a successful investment.

When market information indicates a rapid decline in real property market values, this can indicate the availability of potential short sale real estate. You’ll hear about potential opportunities when you team up with Logan County short sale processors. You will learn additional information regarding short sales in our article ⁠— How to Buy a Pre-Foreclosure Short Sale Home?.

Property Appreciation Rate

The changes in property prices in a location are crucial. You’re searching for a steady increase of the city’s housing market values. Speedy price surges may suggest a value bubble that isn’t sustainable. When you are buying and selling fast, an unstable environment can sabotage your efforts.

Average Renovation Costs

A thorough analysis of the community’s building expenses will make a substantial impact on your market selection. The time it will take for getting permits and the local government’s rules for a permit application will also affect your plans. You need to understand if you will be required to use other experts, such as architects or engineers, so you can get ready for those expenses.

Population Growth

Population increase metrics let you take a peek at housing need in the area. Flat or reducing population growth is a sign of a sluggish market with not a lot of purchasers to validate your effort.

Median Population Age

The median citizens’ age can also show you if there are potential homebuyers in the location. If the median age is equal to that of the usual worker, it is a good indication. Individuals in the local workforce are the most steady home buyers. Older individuals are preparing to downsize, or move into senior-citizen or assisted living communities.

Unemployment Rate

When checking a region for investment, look for low unemployment rates. The unemployment rate in a potential investment region should be less than the nation’s average. If the region’s unemployment rate is lower than the state average, that’s an indicator of a desirable economy. In order to acquire your renovated homes, your potential buyers need to work, and their customers as well.

Income Rates

The population’s wage figures can tell you if the local economy is stable. When property hunters buy a property, they usually have to obtain financing for the home purchase. Their income will show the amount they can borrow and if they can buy a home. The median income data will tell you if the city is ideal for your investment endeavours. Particularly, income growth is critical if you prefer to expand your business. To stay even with inflation and rising construction and material expenses, you should be able to periodically raise your purchase rates.

Number of New Jobs Created

The number of jobs generated yearly is useful insight as you contemplate on investing in a particular city. A larger number of citizens purchase homes if the community’s economy is adding new jobs. New jobs also entice people coming to the city from other places, which further revitalizes the real estate market.

Hard Money Loan Rates

Those who buy, fix, and sell investment homes like to enlist hard money and not regular real estate loans. Hard money loans empower these investors to take advantage of pressing investment ventures immediately. Find private money lenders for real estate in Logan County KS and analyze their mortgage rates.

If you are inexperienced with this loan product, understand more by using our article — What Are Hard Money Loans?.

As a real estate wholesaler, you enter a sale and purchase agreement to purchase a home that some other real estate investors might need. But you do not buy it: after you have the property under contract, you allow another person to become the buyer for a price. The seller sells the home to the real estate investor instead of the wholesaler. The wholesaler doesn’t sell the property itself — they simply sell the rights to buy it.

The wholesaling form of investing involves the engagement of a title company that comprehends wholesale purchases and is savvy about and active in double close deals. Find Logan County title companies for wholesaling real estate by using our list.

To learn how real estate wholesaling works, read our insightful article What Is Wholesaling in Real Estate Investing?. While you manage your wholesaling activities, put your firm in HouseCashin’s directory of Logan County top house wholesalers. This will let your future investor clients find and call you.

Factors to Consider

Median Home Prices

Median home prices are key to locating communities where homes are being sold in your investors’ purchase price range. Below average median prices are a valid sign that there are enough homes that might be acquired for less than market value, which investors have to have.

Rapid worsening in real property values could result in a supply of homes with no equity that appeal to short sale flippers. Wholesaling short sales often delivers a collection of particular benefits. However, there may be liabilities as well. Find out details regarding wholesaling short sales with our extensive explanation. Once you choose to give it a go, make sure you employ one of short sale lawyers in Logan County KS and mortgage foreclosure attorneys in Logan County KS to work with.

Property Appreciation Rate

Property appreciation rate enhances the median price data. Investors who intend to hold real estate investment assets will have to discover that home values are steadily increasing. Both long- and short-term real estate investors will avoid a city where home market values are dropping.

Population Growth

Population growth figures are important for your prospective contract assignment purchasers. If the community is multiplying, more housing is required. There are many people who lease and additional customers who buy real estate. If a population isn’t multiplying, it does not require more residential units and real estate investors will invest in other locations.

Median Population Age

A dynamic housing market necessitates people who are initially leasing, then shifting into homebuyers, and then buying up in the housing market. A community with a large workforce has a consistent supply of tenants and buyers. That is why the market’s median age should be the age of skilled workers in the workplace.

Income Rates

The median household and per capita income should be growing in a promising residential market that real estate investors want to participate in. Income hike shows a place that can absorb rental rate and housing purchase price surge. Real estate investors want this in order to reach their expected profits.

Unemployment Rate

Investors will thoroughly estimate the location’s unemployment rate. Late lease payments and lease default rates are prevalent in regions with high unemployment. Long-term real estate investors who rely on uninterrupted lease income will lose revenue in these cities. High unemployment creates unease that will keep people from purchasing a property. This is a concern for short-term investors buying wholesalers’ contracts to fix and resell a home.

Number of New Jobs Created

Learning how often fresh jobs are produced in the community can help you find out if the home is situated in a vibrant housing market. Job generation suggests more workers who need a place to live. Long-term investors, like landlords, and short-term investors like rehabbers, are drawn to cities with impressive job production rates.

Average Renovation Costs

An essential factor for your client investors, particularly house flippers, are renovation expenses in the city. The price, plus the costs of improvement, should amount to lower than the After Repair Value (ARV) of the house to create profit. Give preference to lower average renovation costs.

Investing in mortgage notes (loans) pays off when the loan can be obtained for a lower amount than the remaining balance. The client makes subsequent loan payments to the investor who is now their new lender.

Performing loans are mortgage loans where the homeowner is consistently current on their payments. Performing loans earn consistent cash flow for you. Some note investors look for non-performing loans because when they cannot satisfactorily restructure the loan, they can always acquire the collateral property at foreclosure for a low price.

One day, you might produce a selection of mortgage note investments and be unable to handle them by yourself. In this case, you may want to enlist one of mortgage loan servicers in Logan County KS that would essentially turn your investment into passive income.

When you want to try this investment method, you should include your business in our directory of the best companies that buy mortgage notes in Logan County KS. Showing up on our list places you in front of lenders who make desirable investment opportunities accessible to note buyers such as yourself.

Factors to consider

Foreclosure Rates

Investors searching for valuable mortgage loans to purchase will want to uncover low foreclosure rates in the region. If the foreclosures happen too often, the community could still be good for non-performing note investors. If high foreclosure rates have caused a weak real estate environment, it could be difficult to resell the collateral property if you seize it through foreclosure.

Foreclosure Laws

Note investors need to understand their state’s regulations concerning foreclosure prior to pursuing this strategy. They’ll know if their state requires mortgages or Deeds of Trust. When using a mortgage, a court has to agree to a foreclosure. A Deed of Trust allows the lender to file a notice and continue to foreclosure.

Mortgage Interest Rates

Note investors acquire the interest rate of the mortgage loan notes that they purchase. That rate will significantly affect your profitability. Regardless of the type of note investor you are, the note’s interest rate will be significant for your estimates.

The mortgage rates set by traditional lending institutions aren’t the same in every market. The higher risk taken on by private lenders is reflected in bigger loan interest rates for their loans compared to traditional mortgage loans.

Successful mortgage note buyers regularly review the mortgage interest rates in their region set by private and traditional mortgage lenders.

Demographics

A community’s demographics data assist mortgage note investors to target their work and appropriately distribute their resources. The area’s population growth, unemployment rate, employment market growth, wage levels, and even its median age hold valuable facts for note investors.
Performing note investors look for homebuyers who will pay as agreed, generating a consistent revenue stream of loan payments.

Non-performing note buyers are reviewing related indicators for different reasons. When foreclosure is necessary, the foreclosed home is more conveniently liquidated in a strong market.

Property Values

The more equity that a borrower has in their home, the better it is for their mortgage loan holder. When the investor has to foreclose on a mortgage loan without much equity, the foreclosure auction might not even cover the balance owed. As loan payments decrease the balance owed, and the value of the property increases, the borrower’s equity increases.

Property Taxes

Escrows for house taxes are normally given to the lender along with the mortgage loan payment. That way, the lender makes sure that the property taxes are paid when due. If the borrower stops performing, unless the loan owner takes care of the property taxes, they won’t be paid on time. Property tax liens leapfrog over any other liens.

If an area has a history of increasing property tax rates, the combined home payments in that community are steadily growing. This makes it difficult for financially strapped borrowers to meet their obligations, so the mortgage loan could become delinquent.

Real Estate Market Strength

A community with appreciating property values offers strong potential for any note buyer. It is critical to know that if you have to foreclose on a collateral, you will not have difficulty obtaining a good price for the property.

A strong market could also be a good community for originating mortgage notes. It is another phase of a note buyer’s career.

A REIT, or Real Estate Investment Trust, is a firm that invests in income-producing properties. REITs were created to permit average investors to invest in properties. The typical investor can afford to invest in a REIT.

Investing in a REIT is a kind of passive investing. Investment liability is spread throughout a group of properties. Shares can be liquidated when it’s agreeable for you. One thing you cannot do with REIT shares is to choose the investment properties. Their investment is confined to the investment properties selected by their REIT.

Real estate investment funds are essentially mutual funds that focus on real estate firms, such as REITs. The fund doesn’t hold properties — it owns interest in real estate businesses. This is another method for passive investors to spread their portfolio with real estate without the high entry-level investment or exposure. Fund members might not collect regular distributions the way that REIT members do. As with any stock, investment funds’ values grow and decrease with their share market value.

You can pick a fund that focuses on specific segments of the real estate business but not particular locations for each property investment. Your choice as an investor is to select a fund that you trust to manage your real estate investments.